OIR Webinar Details Use of New, Expedited Rate Filing System

The Florida Office of Insurance Regulation (“OIR”) held a Webinar on July 8, 2009, that presented instructions and outlined the components and statutory requirements enabling insurance industry representatives to make Limited Reinsurance/Financing Costs filings.

During the 2009 Regular Legislative Session, the Florida Legislature passed House Bill 1495, which was subsequently signed by Florida Governor Charlie Crist on May 27, 2009, and is now in effect.   The bill makes a number of changes that impact Florida property insurers:  It puts into place a gradual reduction of the Florida Hurricane Catastrophe Fund’s (“FHCF”) top layers and adds a rapid cash build-up factor to the FHCF’s rates.

Recognizing that HB 1495 could require insurers to purchase more reinsurance from the private market, the legislation provided an expedited filing mechanism for insurers who are willing to limit their recovery from policyholders to phase in the cost of the additional reinsurance.  At this time, HB 1495 has not had any impact on the collection system or other documents, but is expected to change the OIR Standard Indications Rate Workbook.  To view the bill, click here.

The OIR recently reconfigured its “I-File” system — a workbench for the insurance industry to conduct business with the OIR online — to allow for the new expedited Limited Reinsurance/Financing Costs filings, which require fewer components than a typical rate filing.  The system is ready and allows insurance companies to make this type of filing immediately.  Once insurance representatives have accessed the I-File system, they will click on Form & Rate Filing Assembly and Submission, then on Filing Assembly Submission System, and finally following prompts that will allow them to select the Limited Reinsurance/Financing Costs filing option and fill in the required components.

It is recommended that, when starting a filing, insurers upload a Reinsurance Cost Support Document that includes the responses to each question in order to expedite the filing process.

Insurers making a Limited Reinsurance/Financing Costs filing would be subject to a six-month prohibition on the submission of another rate filing.  If an annual rate filing or annual rate certification is due during this six-month period, the insurer would not be required to make the filing until six months have expired.  However, this applies only to the line of business for which the filing was made. 

Other facts relating to use of the Limited Reinsurance/Financing Costs filing:

• This filing must be made 45 days in advance.
• The rate filing increase cannot exceed 10 percent.
• Use of a Catastrophe Model is not required with this type of filing.
• Regarding the Temporary Increased Coverage Layer, insurers do not have to wait until December to make a rate filing.

The Limited Reinsurance/Financing Costs filing applies to the following lines of business:

Commercial Multi-Peril (050)

• Indivisible Package (for example, business owners) (05.0FLA)
  • Residential (excluding condominium associations) (05.0002FLB)
  • Residential — condominium associations only (05.0002FLA)

Farmowners Multi-Peril (030)

Homeowners Multi-Peril (040)

Inland Marine (090)

• All Other Personal Inland Marine (09.0006FLC)
• Personal Property Floater (Schedule D Property) (09.0006FLB)

Mobile Home Multi-Peril (540)

Mobile Home Physical Damage Only (550)

Property (Fire) (010)

• Commercial Property — Collateral Protection — Dual Interest (01.0001FLE)
• Commercial Residential (Excluding Condominium Association) (01-001FLB)
• Commercial  Residential — Condominium Association Only (01.0001FLA)
• Personal (Dwelling Fire) (01.0002FL)

 

Should you have any questions or comments, please contact Colodny Fass.

 

To unsubscribe from this newsletter, please send an e-mail to ccochran@cftlaw.com.